Nobody thinks they will experience a bankruptcy filing during their lifetime. In some situations, this is the only choice, and learning about the process is crucial. If that happens to you, you can use the information laid out in this article.
Before filing for personal bankruptcy, make sure you are doing the right thing. You have better options. For example, you could try credit counseling. Bankruptcy permanently affects your credit, so avoid filing until you have exhausted all of your other options.
A critical tip in filing personal bankruptcy is to steer clear of making payments to creditors, in advance of filing a petition, in an attempt to satisfy individual debts in full outside of bankruptcy court. Payments to family members and creditors made within defined periods of time prior to a bankruptcy filing can be voided and can jeopardize the chances of receiving a discharge of all debts in the case.
Before you file for bankruptcy, make sure that you sort out your taxes. When you file, the bankruptcy trustee will need to see your tax return from last year and possibly even your tax return from two years ago. If you have these documents ready, your bankruptcy attorney will be able to ensure that the whole bankruptcy process is carried out as quickly as possible.
There are two types of bankruptcy filing, Chapter 7 and Chapter 13 so make sure you know the differences. Under Chapter 7 type bankruptcy, all debts are forgiven. This type of bankruptcy ends any relationship you might have with creditors. With a Chapter 13 bankruptcy, you will have to make payments for 5 years before the debts are forgiven. In order to choose the right bankruptcy option, you need to know the differences between these kinds of personal bankruptcy filings.
It is important that you don’t let bankruptcy get you down in the dumps. Bankruptcy can be a challenging time in anyone’s life, but it is meant to give you a fresh start, enabling you to establish good credit and move toward a better future for you and your family. Remember, bankruptcy is your legal right, so don’t feel guilty or ashamed of taking advantage of it. If you do feel that you are suffering excess anxiety or depression over financial issues, counseling may help you to better deal with your emotions and concerns.
Knowing that you are required to disclose anything that you have sold, given away or transferred in the two years prior to filing can help you avoid a costly mistake. Full disclosure is required. Not disclosing everything can land you in jail or a discharge of your personal bankruptcy petition.
It’s not going to be fun and it’s not going to be easy, but you can simply the process if you’re reading the right information. Adding to your fund of bankruptcy knowledge helps to make the whole process easier. The article you just read have you some of this advice, meaning you can deal with your situation much better.